1 hr ago
Coforge hires Egon Zehnder to search for next board chair
Coforge is a technology services company looking for a new board chair.
It hired a search firm called Egon Zehnder to help find two independent directors.
The search will also help identify the next chairperson.
The previous chairman, OP Bhatt, resigned on 8 September.
DK Singh, who led the nomination committee, resigned two days later.
The company said the two directors did not share some board evaluation information with the rest of the board.
Some investors and analysts are worried about how the board was managed.
Coforge says its business and financial results should not be significantly affected.
It also said it continues to sign large customer deals.
Coforge hired Egon Zehnder to find two independent directors and help select its next board chair.
Chairman OP Bhatt and nomination panel chairman DK Singh resigned in September after reported governance disagreements.
The company said the two directors withheld parts of a board evaluation report from other directors.
Coforge said internal and external candidates will be considered, but internal candidates must be independent directors.
Management said the board dispute will not materially affect finances or business, while analysts questioned governance and director independence.
- Who
- Coforge Ltd, its independent director Vivek Sharma, former chairman OP Bhatt, former nomination and remuneration committee chairman DK Singh, and search firm Egon Zehnder.
- What
- Coforge began searching for two independent directors and a new board chair after Bhatt and Singh resigned.
- Where
- The company and board search are international in scope; no specific search location was stated.
- When
- The announcement was made on Monday; Bhatt resigned on 8 September and Singh resigned two days later.
- Why
- The search follows board disagreements, governance concerns, and disclosures that parts of a board evaluation report were withheld from other directors.
Governance concerns
Management assurances
Board governance
Governance concerns
The resignations, reported disagreements, and withholding of board evaluation information have raised concerns about board transparency and independence.
Management assurances
Coforge said it has started a structured search for additional independent directors and a new chair to address the board’s needs.
Business impact
Governance concerns
Analysts said the board dispute could affect investor confidence and raised questions about the company’s long-term strategy.
Management assurances
Management said there would be no material impact on financials or business operations and highlighted strong progress on large deals.
Vivek Sharma’s independence
Governance concerns
At least two analysts questioned whether Sharma was sufficiently independent to lead the director and chair search.
Management assurances
Coforge said Sharma’s appointment followed an 11-month, third-party-led process that considered 21 candidates and shortlisted eight.
Key facts
- Search firm
- Egon Zehnder
- Board size after resignations
- Seven members, including three independent directors
- Current independent directors
- Beth Boucher, Vivek Sharma, and Anil Chanana
- Former chairman
- OP Bhatt resigned on 8 September after a 27-month tenure
- Former nomination committee chairman
- DK Singh resigned two days after Bhatt
- Latest annual revenue
- $1.87 billion, up 29.2% year over year
- Share performance
- Coforge shares fell 6.1% last week, compared with a 2.27% decline in the BSE Sensex
Quotes
Vivek Sharma
Coforge independent director overseeing the board search and chair-selection process
“We would like to inform you that there's nothing that's changed on that front. That ambition is now nearing fruition, given that there's just two weeks left for the quarter, we had said in the investor call at the beginning of the quarter that we might end up signing as many large deals in the current quarter as we had signed in the full year just two to three years back, and the quarter has progressed as Saurabh has indicated, as planned.”
livemint.com
“Mr. Sharma's appointment followed a rigorous 11-month search, which was led by a global board search firm under a mandate that specifically included independents, and the process was overseen by the NRC. As part of that process, 21 candidates were considered, and eight were shortlisted. Mr. Sharma emerged as our preferred candidate following that process.”
livemint.com
Sources
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